Good morning! Today we anxiously await the results of the second round of US-Iran negotiations, as well as any updates on the Ukraine peace process.
In the meantime though, we had some developments in the Tennessee Governor Democratic Primary as well as in tech, where we had a massive repricing on Apple and OpenAI markets.
Stay ahead of the game with out forward-looking morning brief!
Top Movers
#1 Tense Situation
The market is pricing in the new exercises by the IRGC in the Strait of Hormuz ahead of the second round of US-Iran talks in Geneva today.
Tensions are surely high as both countries hope for the best, but prepare for the worst. Outside of the exercises, both sides are moving equipment - both to intimidate and to be ready for a confrontation if things go south.
#2 Not So Fast
The market is also updating its value for Abbas being out as Palestinian president in recent days.
The move is most likely tied to him being more active in the public space in the recent days. He published a draft constitution as well as went to Oslo and had a speech on the African Union Summit. Initially traders were counting on old age and Gaza peace plan to remove him, but it seems that the 90-year old president is keeping up well.
#3 A Volatile Primary
Moving to domestic US markets, we've seen a lot of volatility (albeit on small volume) on the Tennessee Governor Democratic Primary Winner market.
The move is most likely to Jerri Green leaving her colleagues way behind when it comes to fundraising. That being said, the Republican candidates are even further ahead.
#4 Misunderstanding
We believe this market violently changed price due to a massive misunderstanding of the rules.
The market was trading in the high 80s at some point, as most traders were convinced that a foldable phone will be released this year. Apple is know for rare new product lines (last one was Vision Pro in 2024), thus when they found out in the rules that any new iPhone won't count, the price dropped towards 30c for Yes.
#5 Tail Event
And lastly is an example of how bonding on prediction markets can be dangerous.
While a lot of traders are keen to bond markets (ie. buy when prices are >90c for either option), sometimes it is not without risk. Tail events do happen, as traders bonding ChatGPT outage market learned yesterday. After all, a 5% chance event happens roughly once every 20 times.
Wrap up
That’s all for today - did you catch any of the moves? See you tomorrow for another Morning Brief!
This is not official investment or life advice. Do your own research. This are only my opinions and I encourage anyone to do their own research before putting any money anywhere.